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A year and a half ago, when M-ITI won the bid to conduct this study on "tech4good" in sub-Saharan Africa, we thought we would complete it in nine months. Indeed, our interviews ended exactly a year ago, and while the time to publication has been very long, we feel the findings are solid.

The funders of this study took a major chance with commissioning our team. We told them that we saw a large gap between many Western representations of technology in Africa and what we had experienced ourselves; that our backgrounds and training were very different than most of the teams responding to the call, and that they might be surprised by our findings. Our team included five scholars conducting research in Africa; while only one member was in Africa during the entire study, three others had worked there, and three are from Africa (two expatriated). We have spent person-years in tech hubs; developed major technical systems; and published quite a bit on tech in Africa. We suspected, then, that our informants' portrayals would largely agree with our own experiences, but not with the “Africa Rising” tech narrative favored by the Economist and the World Bank.

A Narrow Path

Despite our experience, we were nonetheless surprised by many of the things that we learned from our interviews. This was one advantage of taking a wide sample of diverse people in the ecosystem, many in jobs or roles we had never occupied, or in countries none of the team had visited. We heard often, and in varied detail, about the challenges innovators faced in attempting to access funding; of finding distribution channels in an ecosystem where the Mobile Network Operators have nearly uncontested power over the “net”; and of running tech hubs.The testimonies we heard were both more diverse and, frankly, often more dispiriting than any of us knew. For example, the degree to which local languages and literacy levels moderated the possibilities of "Northern" approaches to user interfaces was beyond what we had imagined. And the role of race in investment was something we had all experienced, yet we were nonetheless unprepared for its scale and determinacy. These findings led to what became our internal name for the report: “a narrow path.” It is very difficult for a local startup to launch and scale a technology, and the current paths to success are narrow.

We are not gilding lilies in this report. We believe that another team might have highlighted some very different factors, or taken a more boosterish tone. Indeed, we know for a fact that our informants told things to our seasoned Ugandan interviewers that they would never have said to someone "parachuting" in from the UK or the USA. We originally thought we’d publish the names of our interviewees and their institutions, but very quickly realized that unless we promised anonymity to our subjects – many of whom depend on Western donors – we would receive completely different types of responses in our interviews.

Afro-pessimism?

Given the results of the study, there is a chance that this report can be interpreted as what some observers have called "Afro-pessimism." This refers to a description of Africa that only focuses on poor roads, poor infrastructure, poor health, poor governance, and poor… poverty. Indeed Afro-pessimism is a kind of genre, one that dominates certain fields and parts of the media. We hope that this is not what we have done. Rather, our mandate was to focus on what external (in particular UK) funders could do to support a strong social tech ecosystem in sub-Saharan Africa. If we have focused on problems, this is because these appeared to be places where outside energy could help; but they are also concrete examples of where the wrong kind of outside energy can backfire. For example: knowing that there is a dearth of patient startup funding in Nigeria is great, but undercapitalization is not amenable to a one-bit solution. It is not a light switch. Throwing money into startups without understanding the differences between Nigerian business cultures and those in the West, or without understanding the inherent racial biases that shape many investment decisions, is a recipe for failure.

We did not interview a single entrepreneur who did not tell us about major structural challenges in their local ecosystem. This is not to say that Africa is poor or lacking; this might instead mean (as we argue) that the types of things that work in other places will not always work well, or in the same way, in Africa. It might mean, for example, that most of the training materials, online classes, and conventional wisdom about running a tech startup comes from parts of the world where 80% of the economy isn't informal; where there are one or two languages in your national market rather than 40; and where there is electricity.

Africa Already Innovates

Africa's informal economy is dynamic and resilient (if also problematic). The West's formal economy is relatively predictable, but very problematic in different ways (see, for example, the global financial crisis). The fact that most Western countries have at most a few official languages is an advantage to communication in some ways, but many Africans should be considered polyglot geniuses. And the ability of so many Africans to thrive on no more than a few hours of electricity per day is probably a skill we should all be striving toward, at least until the climate is stabilized. Seen in another light, these differences are opportunities – superpowers – if addressed with the right approach to innovation.

Indeed, in one part of the report we write about M-Pesa, which is often hailed as an incredible African innovation. This is partly true: people all over Africa had figured out how to transfer money indirectly by way of electronically transferring phone credit (airtime), which could then be resold. M-Pesa – incubated inside British multinational Vodafone, developed by a UK software company, and initially run on servers in the UK and Germany for the Kenyan market – simply formalized and centralized that process. In this case, Africans’ informal economic creativity was packaged and sold back to them as a monopoly. This story leaves us feeling ambivalent. Not only do aspects of this seem exploitative and extractive, but many technologists in the West are now calling for decentralization of communications, and the development of peer-oriented systems. As we further understand the effects of delegating and concentrating communications in a platform like Facebook, or the impact of AirBnB on urban housing across the world, it is not clear that M-Pesa’s model is better than what Africans were already using.

If there is one message that has emerged most powerfully for us from our research, then, it is that the North/West should stop pushing (educating, funding, evangelizing) its approaches on sub-Saharan Africa, and that Africans should avoid adopting techniques that squander their home-field advantage. For example, there is a great hope that "tech hubs" will lead to a Silicon Valley-esque renaissance for tech in Africa, without noting that Silicon Valley was the itself the product of a hundred years of investment and infrastructure development. This report found that hubs were indeed operating in a parallel dimension to universities, local business and capital, and other pre-existing infrastructure. Their impact is thus significantly diminished. Many tech hubs are doing good work, but if most had been thoughtfully integrated into their local ecosystem from the start, they would almost certainly have more positive impact.

The process of bringing this report to light took longer than expected. After six months of interviews, our early drafts echoed the language of our subjects, and some of our European readers were unsettled by the unexpectedness and intensity of some of the views we uncovered. So as not to lose European readers, we had to moderate our tone and explain things that were obvious on one continent but not the other. This took longer than the study itself. Regardless, here are the results, a bit less fresh than we had hoped, but we believe still accurate and timely. The last year has indeed validated central tenets of the report: that technology is a social and political process; capable of both increasing and reducing equality; and affected by as well as potentially reinforcing racism.

Please enjoy the report, and by all means leave feedback on our "contact" page.

Finally, we'd like to thank the 116 interviewees who gave us their time, and the many other people who contributed in other ways. It was a pleasure to speak with you, and please visit us in Madeira!

Ecosystems are complex, especially across an entire continent with nearly 50 countries. Our executive summary attempts to distill some important take-aways.

Today, two of the commissioners, Nominet Trust and Indigo Trust, have each listed three key points from the report that were most important and relevant. We love their summaries:

Nominet Trust key points:

Africans set the agenda for funders –To support Africans to find locally appropriate ways to build more inclusive, just and appropriate alternative technologies, we need to practice more inclusive, just and appropriate funding.

Social leads, tech follows –Funding has largely been focused on building the ‘supply’ side of social tech, with an emphasis on nurturing tech founders. There’s an opportunity to flip the funding model to look at the ‘demand’ side, looking to community-based organisations to define the challenges and shape how tech responds to them and their needs. Identifying and unlocking the demand first will allow us to supply the most effective tools.

Successful funding supports more than just individual projects – This report challenges us to think about tech as more than just an app or an electronic device, but as a blend of knowledge, intelligence, time, labour, organisation, money and law – a combination that shifts and changes over time. Good funding can provide flexible support to grow and change the elements that nurture social tech – through mentorship, flexibility, networking, infrastructure support and more. This makes an investment in social tech an investment in society – even when a specific tech project doesn’t succeed.

Indigo Trust Key Points:

Engaging Government: Not all tech projects or organisations need to engage directly with government to achieve success. Inevitably, however, the parameters within which all projects must operate are shaped by government through regulation and legislation. A hostile or inflexible framework may pose a significant barrier to success for many projects, so funders need to look more carefully at how the projects they support work with or through governments. Many of the case studies presented in this report have either been led by government (MomConnect), enshrined government involvement from the outset (M-Pesa) or sought government collaboration during the scaling process (iCow). As the report comments ‘Government plays a critical role, both as an enabling influence in the ecosystem and as the direct path to success for many social tech initiatives’ (p.37).

Working with governments, however, is rarely straightforward. They are far from monolithic entities and coordination or agreement between different arms of government is not guaranteed. The job of funders lies in better understanding the political and governmental conditions of countries where they work and seeking out those who are likely to listen (p.63). Alongside this is a need for others to engage in longer-term work to push for better regulation of tech ecosystems to create a more supportive enabling environment for all sorts of tech projects.

2. Flexible, patient funding: ‘For the social entrepreneur in sub-Saharan Africa, the path to success is extremely narrow (p.6).’ Under such circumstances, inflexible funding arrangements or onerous requirements can be a death knell for fledgling tech groups. Donors need to be better able to ‘structure grants… to accommodate the pivots and iterations needed for tech success’ (p.42). Different cases require different treatment from donors – what works for one group, sector or country will not necessarily work for another. Funders need to recognise the diverse needs of different groups and change their approach where needed. Spending more time on the ground, hiring local staff and embracing flexibility are all key to giving local groups the support and breathing space to be able to adapt and survive.

3. Gaps and gluts: Investment in African tech ecosystems is far from smooth or equitably distributed. It is, rather, a story of gaps and gluts – missed opportunities on one side, over-investment on the other. Enthusiasm for and investment in cool, contemporary issues needs to be moderated by investment in less cool, but locally relevant issues. Rural issues, for example, have often received less attention from funders and developers primarily based in urban environments (p.71). Likewise, investment in apps has often overshadowed other forms of technology, such as voice interfaces or radio. It is beholden upon both donors and local tech players to better understand the needs and context of those they want to reach and the best ways of doing this. While the tech needs of individual constituencies may be very different, so too is the funding landscape in different countries. The report recommends that ‘a brief gap analysis in each country would yield information on specific imbalances or absences’ (p.39). This sort of data-driven, intelligence-led grantmaking may help to address some of those gaps and gluts.

@eliseleclerc, Funchal, MadeiraWith contributions from the M-ITI social tech research team

‘Some young people hide from their parents to attend entrepreneurship skills workshops as it is seen as a lowly subject ‘’for losers’’ in their culture’ (Tech hub manager, Gabon)

Sub-Saharan francophone Africa’s lateness in jumping on the bandwagon of global models of technology entrepreneurship seems to be a universally accepted fact. Many articles describe how anglophone African countries have a ten-year head start due to a number of factors, including a more flexible business culture and regulatory environment inherited from the Anglo-Saxon model.

Reports on the tech hub and business markets in Africa invariably give francophone African countries low rankings compared to anglophone countries (GSMA 2016 report on tech hubs, Doing Business 2014 report). However when our study set out to discover the sub-Saharan Africa social tech ecosystem in francophone Africa, I found huge enthusiasm and a great potential for social tech development with the right support.

I spoke to social tech players on the ground, from entrepreneurs to tech hub managers in Togo, Bénin, Côte d’Ivoire, Sénégal, Cameroun, Gabon, Madagascar, and they all agreed that despite this, tech startups have an enormous potential in francophone Africa if a number of barriers can be removed.

Tech entrepreneurs have so far shown extreme resilience and passion for what they do, which can be seen as another form of business culture adapted to their context. They are often people returning from the diaspora (‘re-pats’) to start a tech company in their home country, and they have shown great creativity and imagination in overcoming local obstacles. One hub writes fake landlord contracts for its entrepreneurs in order to enable them to register their companies, (the system is not joined up enough to realise no rent is being paid nor received), while others provide free early breakfast to help their customers focus on their work throughout the day. Another is generating much-needed revenue by authoring ‘soft-landings’ reports for entrepreneurs seeking to do business in neighboring countries. In Cameroon, where the internet was shut down for three months in early 2017 in the anglophone part of the country, entrepreneurs told us that they used intermittent proxy servers every morning to check if they had received important emails, and if they had, they then traveled for several hours to the francophone side to find a place where they could answer emails. In Gabon entrepreneurship is not valued as a career path, and youth organisations have been working with secondary schools for several years to encourage entrepreneurship and business skills. One youth organisation manager told us that while they have broken new ground with many students, their parents still believe that business skills are for those who have failed at school and haven’t been able to find employment, leading students to hide from their parents to attend entrepreneurship skills classes.

Marc Lepage, Innovation Advisor at UNDP in Africa, told us: ‘francophone African countries are lagging a bit behind slightly, but are catching up rapidly...There are some differences and many cultural aspects that set them apart. Tech development is more recent in Central and West Africa, and therefore people are not doing tech full time. Another interesting angle is the recovery and resilience aspect, for instance countries recovering or still affected by the Ebola outbreak in West Africa.’

Some startups are looking for women-only hubs; a female entrepreneur from Bénin explained she felt that, ‘with a similar idea, men have more chance of being financed than women.’ Many startups are also having to run two ventures to be viable. A FabLab manager from Senegal told us: ‘we are only managing to survive by running a commercial venture at the same time as an NGO to overcome the absence of social enterprise status.’ Such enthusiasm and creativity demonstrates the dynamism and resilience of the tech scene in the region.

And indeed they are well on their way: the old reliance on the French-African axis, which is still funding tech hubs through the Organisation Internationale pour la Francophonie (OIF), is slowly making space for a more diverse influx of investment and enabling entrepreneurs themselves to find seed funding for their ideas. French agencies like the OIF and the Agence Française pour le Développement (AFD) have undeniably had a critical role in developing tech hubs and tech competitions in francophone Africa over the last few years, but the entrepreneurs themselves have had to find their own seed funding, either from personal income or from crowd-sourcing, which has widely limited the impact of these initiatives on start-up creation.

It is to plug this gap that new investment funds sponsored by I&P are now opening in francophone Africa, with a funding strategy that should be crucial for tech startups. One of those is Teranga Capital, co-founded by Olivier Furdelle in Senegal in 2016. He explains that ‘the financing amounts are lower (€75K-€300K) than the private equity players usual thresholds and the criteria slightly different in order to support entrepreneurs who are at an earlier stage of their start-up, i.e., who have at least started selling a viable product or service and performed their proof-of-concept on a small scale, even if their company is not yet registered.’ Further upstream in the entrepreneurship process, a seed funding and acceleration program between I&P and USAID will soon provide 0% loans of €10K to €25K to entrepreneurs who have not yet reached a commercialisation stage, and who need seed funding for the concept phase of their idea.

But diversifying seed funding is not the only key to the development of tech innovation in sub-Saharan francophone countries. Another challenge is communication, not only between tech hubs within the same country (a certain rivalry between tech hubs seems to impede collaboration, with many not aware of or not working with other hubs in their town), but also among hubs across sub-Saharan Africa. Marc Lepage explains: ‘What is needed is support around networking and collaboration between hubs and development organisations within a single country and beyond, in order to share not only information but also innovation practices, along a South to South axis, rather than solely North-South.’

The role of the diaspora, alluded to earlier, is often seen as a key ingredient for fostering further tech innovation in the region, and again there seems to be a difference between anglophone and francophone sub-Saharan African diasporas. While we have met with large anglophone diaspora organisations like UK-based Afford, we were told by Togo-born Claude Grunitzky that his attempts at creating a francophone equivalent (Welcoming Diasporas) had been very difficult. Many entrepreneurs have had to find seed funding in Europe or the U.S. in order to start their company in Africa, and diaspora engagement with their African community varies enormously from one country to another within francophone Africa. The Senegalese diaspora for instance seems particularly active when it comes to creating tech innovation, and this could be one of the many factors that have helped the country become a pioneer of tech innovation in the region.

While ‘re-pats’ may be one way of increasing tech entrepreneurship, their dominance in the tech sector may also be a sign of dysfunction in how teams and pitches are recognized as investor-ready, or socially beneficial. When, early in our study, we first noticed the high numbers of ‘re-pat’ founders in the African tech sector, we concluded ‘re-pats’ were especially well-primed to combine locally and globally circulating forms of knowledge. Success rates in attracting funding and media attention enjoyed by ‘re-pats’ and expats, however, do not necessarily translate into success in establishing a grassroots social tech. Our report details a mismatch between local environments and what may be considered social tech by wealthy, outside organizations that fund and make awards. For example, some technologies recognized by those outside sub-Saharan Africa as social techs actually serve only a small elite and do not contribute to widespread social development — we call these ‘bourgeois-apps’. It’s not always easy for an outside funder or evaluator to notice how niche a tech might be, and in fact ‘re-pats’ and expats are often the ones making these applications. Part of the reason for this mismatch between an idea and a successful social tech, as some of our interviewees explained, is that the ‘re-pats’ typically need long periods of adjustment and ‘re-learning’ in order to operate in local business environments; another is that ‘re-pats’ (though not all) tend to come from high-opportunity backgrounds that do not always leave them well-placed to develop social techs with ‘base of the pyramid’ benefits. Similarly, an excellent recent report by Village Capital, ‘Breaking the Pattern,’ details how implicit bias is driving capitalization toward local ‘re-pats’ and Western expats, causing investors to overlook talent born, raised, and educated in Africa, because ‘re-pats’ and their ideas are more likely to be ‘legible’ to them. As former hub-worker in East Africa put it, Africans from the diaspora are ‘automatically placed higher in the pecking order.’ A former regulator, also in East Africa, sees part of the solution to this issue in encouraging more local flows of investment; he told us: ‘investment in Africa needs to be decolonized.’

Returning diaspora contribute greatly to their countries of origin and have a valuable role as ‘bridge’ people, but support for these entrepreneurs should not be at the expense of great local teams, who tend to have less access to global capital flows.

A Numida staff member teaches a new client how to use the Numida accounting system.

@valanchee Kampala, Uganda

Mina Shahid is the co-founder and co-CEO of Numida, a financial management mobile application that uses cash flow and behavioral data to unlock financing for potentially over 22 million African small businesses and enterprises. When Mina, a Canadian born systems engineer of Egyptian descent, starts talking about his startup, he does so with the enthusiasm and charisma of a startup co-founder—but he is also very philosophical, beginning with the history of his startup’s name: Numida. ‘Numida’ is creatively truncated from Numida meleagris— the Latin and scientific name for guineafowls. It’s commonplace for African families to domesticate guineafowls due to their excellent nutritional value. But because these fowls are wild birds, when they learn to fly, there is always the risk they could make away into the woodlands at the expense of the farmers’ investment in looking after them. To enable their domestication, their wings are clipped after hatching. Similarly, Mina believes that the wings of millions of small businesses in sub-Saharan Africa are clipped due to the enormity of challenges they face and thus never have the opportunity to take-off. Without a fair chance, many great ideas lie ‘comatose’ and, with the passage of time, are silently off-loaded into limbo. Such wasted potential!

Where it all started

Ideas are a dime a dozen. Execution is everything. Such and many others are combat-inspired platitudes entrepreneurs love to use. However, sometimes ideas are executed as per the script, and things just don’t work out. Having worked with EWB Ventures, a Canadian seed-stage investment vehicle designed to cultivate talent and nurture early stage social enterprises in sub-Saharan Africa, Mina had firsthand experience working with disadvantaged communities.

“I was working as a consultant for the government of Ghana, at first, ” he says. “In 2012, we started a lending business in Ghana with a focus on agribusiness and particularly food security.” Despite the fact that these small businesses were the powerhouses of Ghana’s informal-sector dominated economy, a major challenge they faced was a lack of cash flow data to prove their business’s profitability and creditworthiness. However, after two and half years of working hard at the project, the lending service didn’t pan out as envisaged. The Ghanaian economy was not faring well. They closed shop and moved on. But the challenge and lessons learnt were the inspiration behind Numida.

“You cannot arrest an idea whose time has come.”—Victor Hugo

“One thing I decided was that if we were ever going to do this again, we would do it differently,” Mina says. Through assiduous collection of data about small businesses, and with an engaged behaviour change programme for the non-tech savvy SMEs, they could hit gold. The best and most promising avenue would be to develop an app on a widely accessible mobile platform.

“Ben Best, Numida’s third co-founder and CTO, and formerly a co-founder of the lending business in Ghana, used the experience he gained together with me to begin building Numida.” Mina recollects.

They did take their swing. One of many swings. Perhaps an infinite number of them. They began with exploratory market research in Uganda, Kenya, and Ghana about small businesses and their potential, and what could be done differently to enable them to take off. According to their preliminary findings, Uganda offered great potential. They decided that Uganda would be it. In January 2016, the not-for-profit Financial Sector Deepening Uganda (FSD Uganda) supported them with an initial grant to build the first version of their product and pilot it with 1000 small businesses in Kampala. Coincidentally, a couple of months earlier in 2015, a survey conducted by FSD Uganda and Technoserve found that 75% of small businesses identified cost and access to finance as a major barrier. So Numida had a stronger case and more support. The pilot kicked off in earnest in March 2016.

A staff member demos the Numida interface.

Supplementary or complementary solution?

A sheet of paper is arguably the greatest app that has ever existed. Fundamentally, businesses must create records for proof of transaction and for purposes of transparency, audit, and valuation, among others. Mina saw that verifiable records could also be used to extend loans to businesses, should the need arise.

For Numida this insight about records was a two-sided coin: it represented both a unique behavioural challenge (and threat) and a latent opportunity to effect tremendous systemic change amongst SMEs.

Millions of SME owners across Africa do not keep traditional, paper-based books or care to consistently document their accounts. The SMEs are deeply ensconced in informal settings, which never call for accountability or urgency, except when insufficient working capital suffocates them slowly and steadily to their unfortunate demises.

Numida, a financial management mobile application, is designed specifically for small businesses in Uganda that don’t keep financial data or record books.

It’s the first (true) Software as a Service for African small business.

But this has not been without challenges

Whereas Numida wants to bring fun into the staid and boring and tedious bookkeeping process, many SMEs have shunned and continue to shun its offering—much as it is to their disadvantage.

Although user onboarding is done by the Ugandans on the Numida team, who understand the subtleties of language and market context, aligning the business owners’ attitudes to modern and novel ways of bookkeeping is where the conundrums begin.

Inherent suspicion toward new practices within the small business owners community in Kampala is a big challenge, and Numida is the first product of its kind on the market.

“If people are viewing us in a skeptical way because we are new product and service, it’s definitely harder to do user acquisition” Mina says.

Competing inside a system that has been gamed: The damaging effects of Uganda’s two-lane internet

Beyond the trust issues that incessantly frustrate their activation and user onboarding programs, a major issue, and one often overlooked by industry experts, is the absence of net neutrality in much of sub-Saharan Africa. Numida’s CTO, Ben Best, recently wrote a passionate plea calling for net neutrality in Uganda and explaining the negative impact of its absence on their business.

Basically, there are two classes of mobile internet in Uganda (popularly known as MBs—Em Bees—or mobile data). The first is the full-open access internet similar to that enjoyed in many parts of the developed world. The second is called a “social bundle” and only provides access to Whatsapp, Twitter, and Facebook (dubbed ‘WTF’), and more recently, Snapchat. Social bundles, which are aggressively marketed by the telcos, are about four times cheaper than the full-open access internet data bundles. Both types of access are sold as 24 hour sessions.

For a business owner to use the Numida app, he or she has to go to the Google Play store and download the application. However the majority of the first time users fail to do so along the way because the app cannot be downloaded using social bundles, which many of them religiously subscribe to. Data can be entered offline, but periodic saving and syncing requires access to the full internet as well. The social bundles are so pervasive that for most Ugandans, the ‘WTF’internet essentially is the internet. Because of this, small business owners don’t understand it when they cannot download the Numida app or save data. You cannot blame them.

“We’re in the market where the largest multi billion dollar tech companies have an unfair advantage over startups,” Mina decries. “This disincentivizes innovation and makes it very hard for local startups like Numida to compete.”

Telecommunications companies have long been complicit in such dubious preferential treatment of the internet through coy marketing campaigns promoting the subsidised social bundles.

In retrospect, however, it is clear that many of today’s large tech companies were successful in large part because they were built on open standards and systems and architectures.

But with the proliferation of social media, the calls to Numida to embrace and build off social media platforms could not be any louder. Besides the big tech giants have lately upped their ante by promoting themselves as strategic and supportive deployment platforms. Mina is not particularly impressed with this suggestion: being a third party on a platform whose terms and conditions are not inclusive of Numida’s goals and prospects. “Everybody is being forced to build bots and services for the Facebook messenger platform, ” he says, “What happens when Facebook decides that Uganda is no longer a market that is interesting to them? What products and services will Ugandans use then, in this unfortunate event?”

Entrepreneurs and staff members talk inside the Numida office in Kampala, Uganda.

Reality check: can you hear me now?

Mina says working with the telcos is inevitable, especially in the future when Numida has gained significant traction. And in this case, it would be the numbers of small business owners who’d be religiously using the app to keep and monitor their records that would provide a double win for them and for the telcos in the long run.

While potentially a dangerous model to emulate, telcos in Uganda have formed close alliances with sports betting companies because there is a mad dash for the services they offer: Quick gains from gambling (at least the promise of) on text-enabled mobile devices using mobile money wallets, without a worry of fees to connect to the internet. It’s about the numbers both telcos and gambling companies love to see on their bottom lines.

In fact, Numida product manager, Christopher Stern, has been thinking about how to include game mechanics common with sports betting in their app, too. This comes after having recently attended the Digital Skills Observatory (DSO) workshop in Nairobi, Kenya organised by the Mozilla Foundation. The workshop was a product of a year long study on the experiences of a growing class of first time Kenyan smartphone users and their interaction with digital financial services. One key takeaway from the study was the quick uptake and pervasiveness in East Africa of gambling and sports betting via mobile phones.

However, Numida is fundamentally different because their mission calls for social impact on top of creating value for their users and ensuring the sustainability of the app itself—unlike telcos and sports betting companies which are concerned only with their bottom lines. The task at hand is to make using the Numida app as enticing as the sports betting apps. How can Numida leverage the mechanics that endear the rich and poor to sports betting, while maintaining their social mission? For example if they promised small businesses quick rewards such as instant loans, or celebrated good record keeping performance according to some sort of leaderboard, would they have a better shot at success ? Perhaps. Would these perks incentivize the users to religiously commit to the mundane task of digital book keeping? Perhaps. These assumptions and more only show that developing a product market fit is no mean feat.

A new pair of wings

Nobody is documenting the cash flow data of small scale businesses and in this data Numida sees a gold mine. To be able to grow and scale, however, Numida will need a pair of new wings. Mina confesses that the grant from FSD Uganda was a critical enabler at the stage before building a product. He explains this is because private investors do not just invest their capital in the company but also become advisers. Your problem becomes theirs too, and they are usually invested for the long haul unlike many other kinds of investors.

Mina says that they have been lucky with their grants but nonetheless there is no such thing as an unconditional grant—every grant has some sort of condition. It gets worse when this grant money is inflexible—it could be a potential killer, more lethal than the lack of access to finance in the first place. The product cycles for tech projects are built on the premises of rapid iterations and pivots whenever the need arise. However many grants are structured in a way that doesn’t allow dynamism and agility. Failure to adhere to the terms of reference could mean failure to unlock a cheque to enable further product development.

“If you’re trying to build a private business, it’s dangerous to rely on grant money because then, there is a lack of incentive to actually develop a business model that works—and is sustainable.” Mina says.

Working for the “dual bottom line” is extremely challenging; Numida carries the yoke of rendering social and economic impact in one shot. While on the other hand, for users to unlock value, they must invest the time in entering data on their mobiles, day by day, to fully harness the benefits of the app. It’s unlike their usual daily dopamine infested bread—Whatsapp and Facebook. And sports betting.